Williams-Sonoma Reports Strong Comparable Brand Revenue Growth Amid Declining Non-GAAP Operating Margin
In fiscal 2026's second quarter, Williams-Sonoma (NYSE:WSM) reported a rise in comparable brand revenue by 6.2%, driven by strong demand across all major brands including Pottery Barn and West Elm. Net revenue increased to $1.96 billion, up 6.7% year-over-year. However, the company's non-GAAP operating margin fell slightly to 17.3%. This decline was attributed in part to a one-time tariff-refund benefit that boosted GAAP operating margin to 22.9%, but did not reflect underlying performance. Williams-Sonoma raised its fiscal year guidance for net revenue growth and comparable brand revenue, citing broad-based improvements across the portfolio as reducing risk exposure from any single product or brand cycle. The company also reported supply chain efficiencies contributing positively to gross margin and SG&A leverage despite a significant drop in merchandise profitability due to tariff costs. The firm ended the quarter with $1.03 billion in cash and generated strong operating cash flow, indicating financial flexibility for future investments.
Tickers: $WSM
Topics: guidance update operating margin decline revenue growth